New Zealand’s worst leadership speech since 2008

Written By: - Date published: 9:31 am, January 24th, 2025 - 22 comments
Categories: Christopher Luxon, economy, infrastructure, jobs, monetary policy, overseas investment - Tags:

The PM’s ‘State of the Nation’ speech about the New Zealand economy titled “economic growth the key to better days ahead” was a bag of words with no plan.

Turbocharging New Zealand’s economic growth is the key to brighter days ahead for all Kiwis, Prime Minister Christopher Luxon says.

In the Prime Minister’s State of the Nation Speech in Auckland today, Christopher Luxon laid out the path to the prosperity that will affect all aspects of New Zealanders’ lives.

“Right now it is a tough time for many Kiwis – we’ve experienced the biggest recession since the early 1990s. Growth is the solution – we must embrace it.

PM Luxon’s gutting of Wellington’s economy through the sacking of multiple thousands of public servants averaging over $100k a year and driving them off overseas is the opposite of economic growth. The government remains over 20% of our GDP so he leads the primary largest lever of that economy.

PM Luxon’s gutting of Kainga Ora, together with the Reserve Bank focus on lowering inflation using interest rates, has collapsed the housing market and through that has also collapsed the ability of NZ households to invest and expand their businesses – because houses are the backbone of our wealth.

“We’ve already made significant reforms in 2024 – take fast-track, stopping wasteful spending, new roads, RMA reform, stopping ram raids, new trade deals, backing farmers, banning cellphones in class, FamilyBoost, making foreign investment easier, increasing speed limits, and focusing councils on the basics.

Under PM Luxon’s leadership New Zealand’s GDP continues to shrink, our trade deficit is worse, private sector debt continues to increase, inward investment has collapsed, multiple manufacturing plants taking out whole parts of our export base have died, outward migration is at record levels, and 95% of New Zealanders who live here have their circumstances going backwards including landlords who have their property values decreased and equity shrink.

“And in 2025 we’re going even further – all focused on growth so we can have thriving businesses making a profit, paying higher wages, hiring more people and investing in more growth. 

We have the highest level of business liquidation in decades, and higher unemployment particularly for Maori and Pacifika.

“Going for growth means wherever you come from, and whatever you want to achieve, New Zealand will be an outstanding place to make it happen.

If that is the case then it is about time PM Luxon landed a deal that shows he has the business shops to be that kind of place.

In his speech Mr Luxon announced major changes to the science and innovation sector and overseas investment, all designed to lift productivity, boost Kiwi incomes, and create opportunities here at home.

“Invest New Zealand will be established as the Government’s one-stop-shop for foreign direct investment.

“Modelled off the success of Ireland and Singapore, Invest New Zealand will roll out the welcome mat – streamlining the investment process and providing tailored support to foreign investors. 

PM Luxon should be reminded of Singapore which has no agricultural base and is within 5 kms of countries with over 500 million people, and of Ireland which has Kerry’s that has long since left Fonterra in the shade despite both being co-ops of about the same age and of the entire economy of Ireland which is an EU member that has become the primary tech gateway for US companies into EU and UK started through the most enormous inward tax breaks. Is he incapable of bullying our handful of key exporters particularly Fonterra which the government invented, to actually improve?

“Invest New Zealand will increase capital investment across a range of critical sectors – like banking and fintech, critical infrastructure like transport and energy, manufacturing, and innovation.

Will this new agency repeat the work of New Zealand Trade and Enterprise? Or the work of Infrastructure NZ?

What funding is Prime Minister Luxon setting aside for enabling these industry sectors to focus their efforts? Maybe they should go back to the original Growth and Innovation Framework of the Clark government which brought our key export-focused industrial areas together to work in natural clusters, such as screen production, food and beverage, packaging and fibre, marine tech, biotech, and the like?

Do we really have to reinvent the wheel every damn time there’s a change of government?

“We’re also undertaking a significant reform of the science sector – because we want more break throughs, more discoveries, more start-ups, more IPOs, and many more opportunities for Kiwis to compete on the world stage.

“Backing our science and innovation sector, and backing economic growth, will drive productivity and make us all wealthier. It will lift incomes, help families to get ahead and also allow us to invest more in the public services Kiwis deserve.

National governments have provided no noticeable funding for either our universities or our Crown Research Institutes for decades, our university world ranking continues to decline, and our polytechs have been reduced to an incoherent ruin over multiple governments but particularly this one.

“We will shake up our Crown Research Institutes, establishing four Public Research Organisations – focused on bio-economy, earth sciences, health and forensic sciences, and advanced technology. 

Did they just forget about this area entirely in the 2024 Budget?

“And I want us to commercialise our brilliant ideas – so that our science system makes us all wealthier. Too often, new innovations are effectively shelved – with potential commercialisation often an afterthought.

“Right now, scientists see too few of the proceeds of their own research. We’re going to change that – with researchers seeing a greater commercial share of their own innovations.”

Does he know what Auckland’s Uniservices does already? Does he know the increase in market capitalisation of university commercialisation spinoffs over the last 3 decades? Why can’t he show what our innovation+commercialisation pipeline looks like already? Does he know an example in of what’s working? Why can’t he even add a fact in here that would show he knows what he’s talking about?

In his speech Mr Luxon also highlighted some of the other areas that would be key for growth – including competition, RMA reform, fixing health and safety rules, backing tourism and mining, and making life easier for farmers. 

“Last year the OECD said that insufficient competition was an important factor in driving New Zealand’s long standing productivity woes – with our distance from other markets making domestic competition doubly important.

PM Luxon surely knows that domestic competition isn’t going to change much without massive state market interventions of the scale of the Telecom breakup. We are beset by longstanding oligopolies in near-cartel like conditions and no one in his government is doing anything about that: PM Luxon should start with looking in the mirror of the Crown’s own culpability in low productivity. He should also know since he ran our airline that our distance from markets played well is also a primary export advantage. Particularly for the things we are world leaders in such as food and beverage, and adventure tourism.

“Too often we see reports of Kiwis getting a raw deal because of a lack of competition. In banking, energy, retail, construction and groceries. I’m up for action.”

If he’s up for action in banking, why doesn’t he start with the bank that PM Luxon already owns; Kiwibank?

If he’s up for competition in energy, he still owns 51% of our major gentailers and 100% of Transpower.

Mr Luxon said that 2025 would be all about going for growth.

“Too often when it comes to economic growth, New Zealand has slipped into a culture of saying no. We need to shift our mindset and embrace it.

PM Luxon needs to be held to actual measures: increases in mean income, increases in % of jobs earning over $100k, increases in businesses expansion and decreasing numbers of business liquidation.

It’s too late and too deep a recession for generalities with no plans or reporting mechanisms to publish and be held to.

“I want our kids to know that New Zealand is where the opportunities are – not Australia or the UK.

PM Luxon should stand at the Auckland International boarding gate and ask them what he could do to persuade them to stay.

“2025 will be another massive year for New Zealand – and I am obsessed with doing everything it takes to unleash the growth, innovation, and investment we need to thrive – because Kiwis deserve nothing less.”

2025 like 2024 on current trajectory is going to be at least as bad for our economy as 2008-9’s GFC-initiated global recession. It is another year of incoherent government, landing no deals, drifting us down into the service levels of Indonesia or Argentina.

Half way through his term he’s just spitballing when he should have highly refined structural proposals about how to use all of the states’ investment arms to common good.

22 comments on “New Zealand’s worst leadership speech since 2008 ”

  1. Hunter Thompson II 1

    The PM's speech seemed to be a desperate sort of cheerleading, the message being that economic growth will take us all to Nirvana.

    What he didn't say was that the environment will be gutted to achieve that growth. His comments on making life easier for farmers are ominous – more crud in our rivers, I guess.

    Even if NZ achieved a record balance of payments surplus, it wouldn't last.

    • Macro 1.1

      Luxon – like Trump – doesn't give a fig for the environment, or even understand the essential role that it plays in not only his life but in all our lives.

    • PsyclingLeft.Always 1.2

      His comments on making life easier for farmers are ominous

      Yea. Will there be ever less scrutiny of this?.

      Cows grazing in mud over winter 'appalling' – MPI

      Cruelty and greed.

      "Many of these animals, around 125, were stuck in mud to the extent that they were not able to display normal animal behaviour like walking and turning freely to access feed or rest in dry areas," he said.

      "The farm was running more than 2,000 head of stock on a relatively small area of land, and this contributed to the creation of mud and animal welfare problems."

      "Their coats were caked in mud, they didn't have a suitable dry lying area and when they were lying down, they were lying in mud. There's little insulation for an animal in mud and the animals were susceptible to the cold," Burrell said.

      I rate the whistleblower farm Workers who alerted MPI….I have to wonder if they were also treated badly. IMO ..yes.

      MPI said both farm workers who initially warned the company resigned from their jobs. Three new farm workers were employed, and they were directed to move dairy cows to pasture areas only on dry days.

      Two farm workers became so concerned about the welfare of the animals they moved stock out of the muddy paddocks, but the company reacted by directing them to return the animals to the muddy paddocks, MPI said.

      Seems there were Directors of this cruel and greedy company .

      A Southland livestock grazing company has been fined close to $50,000 for allowing hundreds of cattle to graze in mud.

      FFPM Grazing Limited

      https://www.rnz.co.nz/news/country/539753/cows-grazing-in-mud-over-winter-appalling-mpi

      Cruelty and greed. NAct1 summed.

  2. Reality 2

    Luxon's loud bragging about the nirvana he is about to gift New Zealand compares with the school kid no one likes who boasts about his father's car being bigger than anyone else's. All smug noise and "look at me, look at me, I'm terrific".

  3. Mike the Lefty 3

    All these new bodies and innovations that Luxon is so excited about are simply rebranding exercises designed to fool the masses into thinking that this government is progressive when it comes to science, research and development. The truth is that funding for all three have been cut drastically in the last year.

    It would be better to keep the existing structures, but to fund them properly and let them do their work without conspiracy theory interference from NZ First.

    I suspect that another reason for the new entities is so the government can control who is on them, keep those lefty stirrers out and have their own creatures installed who will tell the government what they want to hear and study what the government thinks will be the best economically over any other considerations.

    Spending a lot of millions to rebrand is about as meaningful as Countdown supermarkets rebranding themselves as Woolworths.

  4. Muttonbird 4

    How on point for these clowns to bark about commercialising science research while at the same time abolishing Callaghan Innovation, the very institute which was tasked with that.

  5. Muttonbird 5

    because houses are the backbone of our wealth

    We're like meth addicts. We know it's bad and is killing us but we're so psychopathically aggressive about it and refuse to change.

  6. SPC 6

    They are not big on R and D tax credits.

    They are not big on focus of support for graduate students doing research.

    Their reform of the Crown Science and Research sector is risible. This is designed to hide the loss of scientists over the past year (funding cut backs) – they no longer have the staff to maintain the existing structure. Mergers will means prioritisation to work based on staffing assignments and use of more generalist staff rather than specialists.

    They are taking us back to an economy based on land and its resources (mining and farming with less regard to the environment) and data centres (bidding up the demand – price of power to our businesses and homes).

    And sell off of assets. First new build of hospital and school buildings, then sell off of the ones we have to lease back.

    https://www.stuff.co.nz/politics/360557646/pm-christopher-luxon-announces-major-changes-science-and-research-sector

    The nature of the reform is inconsistent with their opposition to Labour's polytech changes.

  7. AB 7

    "I want us to be successful by being successful. I have no idea how yet, so I'm burbling out some totally conventional, upbeat, aspirational hogwash. Then I'm going to find the cheapest, quickest, meanest, dirtiest way of giving it a crack that will have no structural longevity and will enrich a minority of kiwis and a few elite foreigners. Unlike you naysayers, I'm clever, energetic, super-focused, super-excited and onto it."

    • Clive Macann 7.1

      And SORTED.

      • Patricia Bremner 7.1.1

        You forgot racist and mean. No mention of the Treaty Waitangi or any other ethnicities. No funding of food Banks after June. No grasp of what is happening on the ground, as he travels in comfort. Unlike Greg Foran he does not meaningfully "work on the floor" Luxon does it for 'photos and clicks. A new meme could be

        "Plastic Prime Minister".

    • Bearded Git 7.2

      Brilliant. It's only so good because it's true.

      Though it should be "unlike you bottom feeders"

  8. thinker 8

    The PM’s ‘State of the Nation’ speech about the New Zealand economy titled “economic growth the key to better days ahead” was a bag of words with no plan.

    …and yet David Seymour's equivalent speech, delivered today, makes Luxon's speech look positively Churchillian.

  9. Kat 9

    Where have all the real journos gone……

    Come back Kim…….please….your formidable skills are needed….this pretense of a PM requires a talking too……

  10. Jill Proudfoot 10

    Has Christopher Luxon simply not noticed that record numbers of Kiwis are leaving the country? Or does he simply not care?

    • Muttonbird 10.1

      He knows. He cares (because it reflects badly on him). But he's trying to bluff his way through, it's all these guys know.

      That idiot, Seymour, referenced the same at his ‘alternative Ratana’ in the extremely wealthy suburb of Orakei.

      The pair of them are in denial that it is their government which is making young Kiwis flee.

  11. Quinster 11

    The only people who will come out on top ,after this government are the people who were already a safe financial enviroment. Everyone else,the poor,the police,teachers,retirees, ,doctors,nurses,beneficiaries,construction,industries,students are all getting shafted.

    Tax cuts,inter island ferries,infrastructure,crime, are also nz themes that are in the "you have to be joking category "

    New Zealand is a mess! Why wouldn't people leave! That's what people do when confronting a tyrannical dictator!

    They run!!!!

    • tc 11.1

      People who can get away are getting away from the deliberate culture wars, tough on crime BS, crushing of our health system and ideological buggery in education to name just a few.

      Many have been forced to leave as simeons purge in transport ended many job's plus health cuts etc.

      No guarantees they lose the next election with the owned media echoing atlas talking points and soapboxes for any coalition member.

      The damage will be generational IMO even if its only for 1 term.

  12. I agree – it was a terrible speech full of acid old ideas and tired platitudes from the deodorant marketing man.

  13. Subliminal 13

    Nicola Willis and Luxon are both of the ilk that believe that running a country is the same as budgeting a household.

    Neither they nor Rachel Reeves in the UK seem to grasp the one glaring difference. The government owns a bank (RB), and this is not true for any household.

    In a recession, the government must increase spending since this is the only source of new money. A recession is the rght time to do all that infrastructure building that we were about to embark on with three waters, upgrades of Wellington and Picton terminals, Dunedin and Nelson hospitals and Kainga Ora just getting up a good head of steam.

    All those skilled people that have left? They would still all be here. Of course the private sector would be grizzling about the struggle to get workers that prefered the wages and conditions of the pubic sector but cafes and restaurants would still be buzzing and that buzz would drraw more skilled workers, or God forbid, we build the Universities and Polytecnics to train our own citizens, to build and maintain the infrastructure that our country deserves.

    But no…Austerity must be implemented. Government spending must be shrunk at a pace faster even than Ruth Richardson and the faster the economy shrinks the louder the calls for more and more austerity and the sale of the commons to 'balance' the budget.

    From Richard Murphy, who talks about the same thing from a UK perspective:

    The politician who uses the household analogy, as Rachel Reeves does when she talks about her mother balancing the household budget every month by checking the bank statement, is making a false comparison that is, to be candid, completely and deliberately misleading. So, I want to explain what the household analogy is, and why it’s so inappropriate.

    The first and most obvious point to make is that governments are not like households, and there are a number of reasons why. The first and most obvious one is that the government owns its own bank. Not only does it own its own bank, that bank is actually the creator of all the money in the economy.

    The problem that the politician who likes to talk about the constraints upon the government because there is no money is referring to the idea there is no money left in the economy, the credit card is maxed out, the overdraft limit has been reached, and everything else. But that isn’t true when you own your own bank.

    When you own your own bank, you simply tell them to up the limit.

    Or, as is the case with the UK government and the Bank of England – and has been the case, by the way, since the 1860s – if Parliament passes a Bill that says the government will spend, then the Bank of England is legally required to make the payment whether or not the government has any money in its bank account or not. It simply increases its overdraft.

    You haven’t got such a facility. Rachel Reeves’ mother didn’t have such a facility. But Rachel Reeves, as Chancellor of the Exchequer, has got such a facility. This is the difference between a government and a household…

    In a household, in a bad time, there will be a serious attempt by the householders to cut their spending, to balance their budget, which is what we have also seen governments try to do. That’s what we call austerity. But actually, in bad times, the government has a duty to increase its spending.

    Why? Because the private sector isn’t spending and households are reducing their spending, and therefore there’s a recession. And the only way to stop that recession is for someone to act counter-cyclically, as it is said. In other words, for somebody to start spending, even though the economic messages being sent out are that we are in a downturn. And the only agency capable of doing that is the government. So, the government has to behave in the exact opposite of the way in which the household does.

    And by and large, that’s true of pretty much everything I’ve said about this household analogy. If the household thinks it’s a good idea to do something, pretty much you can say the government should do the opposite. Because they are the opposite of each other. The household is the microcosm of society. The government is the macrocosm of society. Its job is to manage the overall scene and to compensate for what goes wrong at the household level. It must take the opposite action to ensure that, overall, there is balance within the economy for which it is responsible.

    https://www.nakedcapitalism.com/2025/01/the-curse-of-the-household-analogy.html

  14. Murray West 14

    Hoping that these clowns will be around for only one term is probably wishful thinking. For at least the last 75 years National led governments have always been voted in for at least three terms. We Kiwis are gluttons for punishment. Hunker down, only eight years to go!

    • Muttonbird 14.1

      First post at The Standard and this is what you came up with? I suspect you may not make it to the Budget let alone the next election when National will be judged.

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